Africa - World Bank commitment

World Bank's $1 billion to spur Africa IT

World Bank doubles its commitment in Africa's broadband infrastructure development by investing $1 billion

Government officials and industry insiders have high hopes for the World Bank's additional $1 billion investment, announced this week, in the development of the information and communication technology infrastructure in Africa over the next five years.

The World Bank's private arm, the International Financing Corp. (IFC), is investing in Africa's fiber-optic cable systems by giving loans to governments and private partners, service providers, and investors to extend access to ICT.

"The World Bank is now doubling its commitment in Africa's broadband infrastructure development in the next five years by investing $1 billion in broadband infrastructure development," said World Bank director of operations, Hartwig Schafer. He added that the aim of the funds is to make sure that the continent catches up with the rest of the world in broadband connectivity.

With the announcement, made this week at the Connect Africa summit in Kigali, Rwanda, the World Bank is raising its commitment to African ICT to $2 billion by 2012, from its current investment program of $1 billion over the past five years.

Many African broadband projects remain incomplete due to lack of funds, said Rwandan president Paul Kagame at the Connect Africa summit.

The bank is also pushing African governments to ease restrictions on the acquisition of international gateway licenses in order to promote competition by service providers and lower telecom. Acquiring an international gateway license in Kenya costs $214, 000, a figure that service providers say is beyond their ability to pay and prohibits development.

In August this year, the bank approved a $32.5 million loan to East African Submarine Cable System project, designed to connect 21 countries in Africa to each other and the rest of the world.

Celtel International, Africa's second largest mobile service provider, received a $320 million loan for expansion in five countries on the continent, including Madagascar, Uganda, Sierre Leone, and Malawi. Celtel has a presence in 14 African countries.

Schafer said the bank would also partner with universities, ICT regional regulatory associations and IT institutions in Africa to offer training and capacity development for regulatory staff.

According to the bank, from 1995 to 2005, it invested $25 billion in the ICT sector in Sub-Saharan Africa through private operators and investors. Sub-Saharan African includes Zambia, Botswana, Namibia, Malawi, Tanzania, and Kenya.